Adverse drug reactions and noncompliance with drug regimens account for a significant proportion of hospital admissions, especially among the elderly. The Smart Pharmacy Card creates a portable patient record to facilitate prospective drug utilization review (DUR) by physicians and pharmacists before writing or dispensing a prescription. Patient medical history (disease states, allergies, prescription medicines and non- prescription drugs) will be encoded in an integrated-circuit card. An export file using ANSI Xl2 transaction data sets will allow practitioners to import patient card data into their own automated systems to test for drug conflicts and initiate electronic claims. Initial card use will be sponsored by an organization dedicated to improving the quality of care received by its 50,000 members. Five hundred members will receive cards; terminals and software will be provided to participating hospitals, clinics and pharmacies. The ultimate objective is a product issued by insurers or employers, carried by patients and used by practitioners to alleviate drug-related morbidity, prevent hospitalization and premature entry into nursing homes, improve claims processing and save billions of dollars in annual expenditures.